Cheat Sheet 3: Weekly Binary Options Trading On The Weekend
It is no secret that weekly options in traditional options trading has been the most successful innovation in the options trading world over the last decade. The popularity of these instruments has at times dominated typical monthly option usage, as traders have been able to utilize these shorter-term instruments to implement trading strategies around 1-day events.
Did you know you can trade weekly binary options on a few binary trading platforms with fixed returns in the 350-700% range? These options, which can only be placed on the weekend, come in the touch variety, meaning they profit if the underlying closes above the call level and/or below the put level on any of the 5 days of the coming week. The levels change each week depending on the market and company specific events. However it is my belief that the platforms are still trying to figure out how to price the ranges effectively…meaning there is opportunity for traders.
I’ve found the most success placing weekend trades on companies that have earnings or some other event (conference, product launch) scheduled for the upcoming week. You can very easily calculate how volatile the stock has been on average around previous earnings and determine if you feel the range is appropriate to trade. I rarely choose a direction, I simply buy both the put and call, looking to profit from movement beyond the target levels in either direction. We highlight attractive weekend trading candidates via email so be on the lookout for that every weekend.